Rick Perry's Marriage Problems

Subsequent tax reform bills, especially the one signed by Richard Nixon in 1969, which also introduced the hated Alternative Minimum Tax, reduced the value of a joint return to only about 1.6 persons, while increasing the tax benefit of an unmarried "head of household" to about 1.4 persons. Simple arithmetic shows that a single parent with an unmarried live-in "partner" gets more favorable tax treatment than respectable married couples struggling to support their own children.

And by the way, the postwar "baby boom" happened during the 20-year period when married couples were fairly valued in the federal income tax. That's not coincidence; incentives matter, and America's marriage rate and birth rate plummeted after the value of the joint return was reduced.

Although the Perry plan's most striking feature is its anti-marriage bias, his proposal for corporate income is equally pernicious. Perry would shift businesses to a "territorial" tax system, which means that corporations would be taxed only on the profits they earn inside the United States.

We should do exactly the opposite. We should reduce or eliminate taxes on businesses that employ Americans producing goods and services inside our own country, while increasing taxes on the profits that corporations earn by outsourcing or manufacturing overseas.

Above all, we should eliminate the foreign tax credit, a self-destructive provision that allows corporations to pay China, Venezuela or Saudi Arabia the money they would otherwise owe the U.S. government. Let's also cut out the deductions that U.S. corporations take for hiring foreigners to do work that Americans can do.

Those who support a territorial business tax argue that it will encourage multinational corporations to bring home the profits they earn overseas, but that's unlikely so long as it remains more profitable for them to invest in cheap-labor countries. Of Republican presidential candidates, only Herman Cain and Rick Santorum understand that what corporations need is lower taxes on their operations inside the United States rather than on the profits they earn in other countries.